A trader works on the floor of the New York Stock Exchange in New York, the United States, on April 3, 2025. (Xinhua/Liu Yanan)As escalating trade tensions kept investors on edge, the Nasdaq, home to many tech companies, had fallen 22.73 percent as of Friday's close from its record high last December.NEW YORK, April 5 (Xinhua) -- The once high-flying Nasdaq Composite Index plunged into a bear market on Friday, as the U.S. stock market sank for a second consecutive day amid growing concerns over retaliation following the "reciprocal tariffs" unleashed this week by the Trump administration.As escalating trade tensions kept investors on edge, the Nasdaq, home to many tech companies, had fallen 22.73 percent as of Friday's close from its record high last December.According to Dow Jones Market Data, the index fell 962.82 points, or 5.82 percent, to end at 15,587.79, officially entering a bear market for the first time since 2022.The Russell 2000 Index, a small-cap U.S. stock market index that tracks the performance of 2,000 small companies, entered a bear market on Thursday, down over 20 percent from its recent peak in November, CNBC reported.It added that small-cap stocks were once thought to be primary beneficiaries of the Trump administration's policies. But the index's rout, which marks the first major U.S. benchmark to reach that territory following a monthlong sell-off, reflects a "softening" economy that could "hurt profits."Along with the Nasdaq, the Dow Jones Industrial Average and S 500 also suffered losses of over 5 percent on Friday. The Dow Jones Industrial Average fell by 2,231.07 points, or 5.50 percent, to 38,314.86. The S 500 dropped 322.44 points, or 5.97 percent, to 5,074.08.Meanwhile, Wall Street's "fear gauge," the Cboe Volatility Index, surged 50.93 percent to 45.31 on Friday, marking a five-year high.U.S. Federal Reserve chairman Jerome Powell said Friday the agency would take a wait-and-see approach facing the shock of reciprocal tariffs."We are well positioned to wait for greater clarity before considering any adjustments to our policy stance," said Powell. "It is too soon to say what will be the appropriate path for monetary policy."Powell added that he expects "higher inflation and slower growth" from larger-than-expected tariff increases and relevant economic effects.Meanwhile, the U.S. unemployment rate edged up to 4.2 percent in March from 4.1 percent in the previous month.Reuters said in Saturday's report that while the employment report indicated fears of an economic stall in the first quarter were likely an exaggeration, economists expected the effects of the reciprocal tariffs "could be evident as soon as with April's employment report," noting that "a recession over the next 12 months remained on the table."Economists warned that tariffs would "snarl supply chains and raise prices, culminating in layoffs as spending by both households and consumers retrenched," it added."We continue to see evidence that an already gradually weakening labor market is ill-positioned to withstand new shocks from elevated uncertainty, increased tariff costs, cuts to government spending and employment, and weakening business and consumer sentiment," said Veronica Clark, an economist at Citigroup. "April data should be at least modestly softer, with clearer weakness starting in May and over the summer months."